tv Fast Money CNBC February 19, 2013 5:00pm-6:00pm EST
between different companies because it's so much. for example, the ge's of the world, the large multinationals, at one point would rely on companies like oracle, one company to organize and store and protect the data. but now in the world of big data, ge and so many others will police that business using oracle for traditional data and smaller upstarts to collect other data from mobile divisons, from cars, et cetera. washing machines. the major banks face hacking attempts hundreds of thousands of times a day. at different levels of sophistication. the bottom line is, this is a rich and developing story. it's a scary one, because data is growing so fast, it needs to be protected and organized. but the hackers out there are moving just as fast, or by some accounts, even faster to get an edge. it is a serious issue and serious people are working on it. that means at the end of the day, they will be rich and investment opportunities in this space, as so many companies recognize the threat and are racheting up their research and development to be the go-to firms to protect valuable data.
we'll continue to report on this story and watch it closely. before we go, take a look at the day on wall street. a pretty good day. take a look. the dow industrials, staying above 14,000 with a gain of 54 points at 14,035. volume on the light side today, but the nasdaq and s&p gaining points on the session. shares of herbalife higher in the afterhours trading session tonight. the company reported better than expected fourth quarter earnings. the stock is up .36. thank you so much for being with me. talk to you on twitter and google plus. stay with cnbc. "fast money" begins right now. live from the nasdaq market site in new york city's times square, i'm melissa lee. deal mania. from office's office to dell's dell, how you can belt on the smart money. best buy. the stock is on fire this year, but should you put your money where richard schultz's mouth
is? a good old fashioned street fight. and apple versus goodell. the country's top analyst weighs in. while colin gillis is looking beyond the two for his top pick. first, let's go to the markets. the dow and s&p 500 hitting fresh five-year highs. and it looks like the stocks are breaking out. if you are a believer what is your top breakout trade at this point? josh? >> well, we broke out in mid-january in the wilshire 5,000. we have heavy participation from small and mid caps. the area that i still think has the most room right now is energy. specifically exploration and protection. they have not kept pace over the last couple of years with the rest of this market, so, if you want to own the basket, the ticker is ieo. specific names, look at apache, every one of these charts looks incredible and valuation-wise, they still have room. >> why not go with the refiners? >> what i'm pointing to you is the next refinery -- the
refiners, those charts are hockey sticks. you want to focus on companies that can do what the refiners have done. if you get an uptick in nat gas and oil, these are the names most levered to it. and they are not screamingly expensive. >> hi, guy. >> hi, mel. oracle. i'm not a believer we're breaking out. we'll get into that later. >> why not? >> do you want me to give you the top trade? >> go ahead. >> look at oracle, the deal got approval today. that stock has been on fire. going to basically make a 13-year high in the next couple of days. i think oracle still works here. they do everything right. valuation for that company might be stretched. love the name. >> karen? >> i'm not really such a market trader. i don't know breakout or not, i look at some of the stocks and google is breaking out, crossing $800 today. i'm not going to sell it. nothing's changed. the story is, the valuation is a tiny bit more expensive but i think the story is excellent and much rather own this than facebook. >> i was looking at historical
valuation chart and it looks like it's trading at, i don't know, roughly half of what it was trading at back in 2010 in terms of p.e. >> i like to look at that, i like to look at free cash flow. p.e. is an important one here and i think that it was so low that people think, wow, the p.e. must be richer. it's not, it's not anywhere close to rich here. >> 24. back then, it was 40. >> that doesn't include the cash. >> that's true. tim? >> when i look at the world that's breaking out, the one world that's broken out dramatically is japan. if you look at what came out of the g-20, no, they didn't get their wrist slapped, but what you really got is lack of coordination between the ministry of finance and the abe economics. so, the end is way oversold, meaning it is going to run into resistance at 95. i would be a seller of the yen. the way you can do that is simply, you can sell the ewj. there are etfs out there that are two times short the yen and
that is something you take a look at here. the yeb is way oversold. it will probably be going on a weakening trend and i would say, stop yourself at 95, if it breaks that, it's going to 100. japan's been a very big trade for some of the biggest funds in the world. i think it's some what long in the tooth technically. >> now that we've gone through the individual trades. but i think it is key here to just, for a minute, pause and take an assessment of where we are right now because a lot of people out there are wondering if they've let it get away from them and you said, you're not a believer in this. why not? >> you can't look at this in a vacuum. a couple of months ago, we talked about three things happening. when the s&p had a 1420 handle, we would push towards 1550. we talked about the march 2000 high, we sort of flagged 1550 as the level. we're getting close. and we said when ten-year yields were 160ish, that will probably push to 2%. here we are now, when the vix was in the high teens, we said probably see a trade down to 12.
basically all three of those things have happened. i'm not of the belief that this is going to continue. i think we're coming to some crescendo. probably means the s&p has 30 handles or so in it. when everybody starts about is it time to leave, there are warning signs throughout -- >> i have to cut you off. we want to go to headquarters and check in with kayla. >> that's right, melissa. aftermarket today, we saw form four file detailing the compensation of b of aceo brian moynihan. i've just recently learned from a source familiar with the matter that the board actually also approved an increase to his base salary for this year, for 2013, to $1.5 million. that's roughly a 60% increase from the $950,000 that he had been making in 2011 and 2012. of course, that's base salary, frozen in due part because of the stock's performance and other performance metrics for the company. but this would put him in line to earn what jpmorgan's jamie
dimon earned last year. morgan stanley's james gorman got a similar bump to his salary by morgan stanley's board for this upcoming year. so, definitely a big move of confidence on behalf of the b of a board for moynihan this year. again, his salary being upped to $1.5 million for the year 2013 here, and $12 million, so far in salary and stock awards for 2012 for what we can tell, that's compared to $7 million from the year prior. melissa? >> thank you, kayla. i think key here is that it puts him in line with the likes of a jamie dimon. do you think that he's worth every penny as jamie dimon is? >> well, you can't ask me that. i'd say no -- >> separate your feelings. >> i think -- it doesn't really move the needle for me in the story at all. at all. unless he were just a wildly different compensation scream than this, doesn't matter to the story to me. >> let's continue to discuss stocks here. stocks hitting fresh five-year highs. is it time to take profits?
joining me now is john stolsis. you made the point there are eight trading sessions, seven until sequestration and we could hit some speed bumps at this point. what kind of speed bumps are we talking about? >> i think what we're looking at is probably a lot of it will be rhetoric out of washington, d.c. both sides of the aisle have significant con stitch when sips that need to be paid homage to, but ultimately what we think is, we're going to get a deal. either a cliff hanger like with the fiscal cliff or we actually go through the date and then within 24 hours we get the agreement. but if we were to go through sequestration full force, hit the wall at full force, it damages constituencies on both sides of the aisle. and it gives the likelihood that some of these politicians would get a legacy of being said that they helped snatch defeat from the jaws of victory --
>> we could hit it full force but the question is, how long do we actually stay in sequestration until a deal is hammered out. and that's going to be key. sort of like going on the fiscal cliff. went over it, wasn't such a big deal because at the end of the day, both sides look like they are coming together. >> cooler minds prevailed. >> right. >> consensus right now is we do go into sequestration. all of the political journalists would tell you, it looks like it. so, if that's consensus and you see the selloff in defense stocks, why do you think that the impact will be that much more than that, and if someone's time horizon is more than six months, should they pay attention at all? >> josh, what i remember is december 31st, front page of "the new york times," a senator that said, there's no deal, looks dark, end of the world and then -- >> buy signal. >> right, exactly. i think similarly, we'll come through again. issues are too great, the progress that's been made has cost too much to set back. and i think for investors, investors have got to get real.
don't look for instant gratification. look -- you can look for near-term gains and -- but expect volatility, embrace uncertainty go with quality. go with what you understand. and i think that you're seeing a general shift that has begun since the end of last year into know. where we're seeing people who are grossly overweight fixed income are beginning to recognize the value of equities. >> what are you telling clients? to not put any new money to work in eck by tips at this time or are you a believer longer term in the rally to say, go ahead, pull the trigger and ride out this volatility. >> i'm telling them not to back up the truck, but i'd be nibbling. i'd be looking for value. when you talked about -- about the exploration and production of the enps, i'm still buying refiners, because i think the crack spread play continues to work for a little bit longer. but i'll be looking at some
financials that look attractive, things like jpmorgan, kkr -- >> let the headlines create opportunities. >> right. >> john, great to have you with us. the year-end target, 1585. thank you for coming by. >> let's get a quick market flash, check in with josh lipton. josh? >> hey, there, melissa. herbalife report after the close, edging into the green here. herbalife beats on the bottom line by two cents. revenue basically in line. looking ahead for the full year, eps a bit light, but revenue better than the street expected. as for that guidance, the company saying it excludes one-time costs of $10 million to $20 million, mostly legal and advisory services relating to its response to information put into the marketplace by a short seller, which the company believes to be, quote, inaccurate and misleading. melissa? back to you. >> josh, thank you. >> one effective way to get your short to run to fruition. just drive these games into a legal battle. >> spend more, more, more. >> kills energy. >> i'm not sure it's an earnings
story at all. if i had to choose between mr. icahn and ackman, i love carl, i sort of side with bill ackman. he's done three, four times the amount of work that carl's done. carl appears to have it right for now. i think the market at some point will bear out the fact that mr. ackman's spot-on. >> this is ultimately, to me, on some level, up to the decision of someone to determine that the entire business model is -- is not worthy, or -- >> and ackman can be right but the trade may not work out for him. two different issues. >> and that's bearing itself out right now. maybe homework is the wrong phrase. i think he's don he his work. he does thoughtful work. and my sense is -- he knows something, he would not be putting out a bet of this magnitude unless he was confident. >> more details probably tomorrow on the conference call. get herbalife's conference call tomorrow. meantime, let's hit pops and drops. pop for gnc, up 4%. karen? >> that wellness trade really
working well. it was up last week on earnings. little follow through today. we own it but sold some upside calls against it. >> first solar, a pop, the move 6%. guy? >> a tremendous move. maybe started with the state of the union. i don't know. traded two-times normal volume today. you probably see it pop again tomorrow but i would pull the rip cord on this one. >> pop for sealed air. josh brown? >> it was a so-so earnings report, but this thing ran like a wildebeest today. barclays is talking about, this is unjustified, they can't figure it out. if you are in that camp, i would take profits. >> you followi inin inin inin i? >> drop here for goldfield, down 1%. tim? >> it's running the opposite direction of a wildebeest. >> i don't like those. >> the anti-wildebeest. they've missed on their numbers. they spun off one of the higher producing assets they have.
people are mixed on this. i think it's overdone. >> and a pop here for bourbon drinkers. after announcing a move to water down its bourbon, maker's mark says they have reversed the decision. after thousands of distressed drinkers slurred complaints, the company decided to keep the recipe intact. >> let me ask you a question. ill know you're not a bourbon drinker, but when was the last time anybody talked about maker's mark? >> when was the last time anybody heard judge thurgood? >> it caused a buzz. exactly. >> ah. >> like new coke. >> the kids -- >> after that, they were number one. >> cut "fast money" by ten minutes, see what happens. >> all right, coming up next on "fast money," what is at stake for apple shareholders after david einhorn reiterates its case before a judge? plus, crude awake ng.
dennis gartman tells us what is fueling soaring prices at the pump. and a big box street fight, why traders tim and guy are not s seeing eye to eye on best buy though the retailer is making its price match guarantee permanent. back after this. ♪ [ male announcer ] when we built the cadillac ats from the ground up to be the world's best sport sedan... ♪
easier banking. standard at citibank. best buy extending its price match guarantee to include online retailers all year long. sharing moving higher on the news. best buy wants to prevent consumers from using its stores as a show room and buying the items cheaper on the internet. so, is best buy more attractive now. tim is our bull, guy is the bear. guys have 90 seconds to make the case. tim? >> it's much more attractive. and despite the fact that people have known they were leaning in this direction, this is -- first of all, a reaffirmation that management knows what they're doing. i can go into best buy, do the show rooming and then i can actually buy it there. my partner here is going to argue the bear case, who, quite often does this and whether it was barnes & noble reading books or best buy, this is going to stop. ultimately, these guys are showing it's about cost-cutting, a management team that's going to be proactive.
they're not going to be trading at a 15 times multiple. at five times, it is ridiculo ridiculously cheap. this is where this company is very cheap. the takeout bid, the privatization bid is ultimately a backstop for the stock. a stock that today got above the 200 since march of last year, so te technically, a very good place. it's a cheap valuation and they -- >> guy? there's no buzzer, you have to jump in. >> i'm waiting for him to talk. >> i'll talk forever. >> the man with piercing blue eyes makes cogent arguments but he happens to be wrong, because this price match thing is something they should have done three years ago. i think the consumers have evident will best buy. they show up there to do what you do at barnes & noble. you walk around, buy things online. the match program, good in thought, won't work. also, they're going to get more revenues but it's going to come at the expense of margins. they're going to sell lower end products. margins are going to get
constrained here. and this schultz thing, that's why the stock has gone higher. he can't get the financing. >> i heard a buzzer. i heard a buzzer. >> i sense he doesn't get it. they report earnings that day. i think you sell it right now. >> you spoke for one full minute, him going over by eight seconds is fair enough. the other thing about the price match guarantee is they have cut the return policy in half. you have 15 days to return a product. 15 days to test out, josh, your tv, whatever you have at home -- >> i agree with guy. too little, too late. they should have been thinking this way two years ago and even if this is a success, all they're really doing is hurting their margins even further because they're going to honor price cuts they can't afford to give. i don't like it at all. >> the other funny thing, karen, was that consumers have to ask for the price match otherwise, they won't get it. i have to be cognizant i can ask for the price match guarantee. if i just go in there -- >> adverse selection of customers that will ask. >> if you didn't know that, you are paying full price and actually paying full margin.
that's a benefit. people that know they have price matching are going to be in there and going to be in a store where they can touch it and feel the product with their hands and then they can know they're getting the best price. >> did you get called on? no. >> this is how i roll. >> tim just talks. all right, guys, good debate. >> thank you. >> let's talk gas prices. record highs for the first year this year. aaa reporting the average national gas price is $3.75 a gallon, compared to $3.57 a year ago. prices have climbed 32 days straight. so, what's behind the moves and are prices headed higher at this point? for more, let's bring in dennis gartman, publisher of the world renowned gartman letter. dennis, good to see you. >> always good to be seen, mel. >> dennis, we have heard it all, in terms of the refineries switching over to the summer blend and there's a disruption here. but at some point, in theory, that should abate and prices should come down a little bit. what do you see? >> one would think.
there's been an extraordinary short squeeze that's going on in the gasoline market. you had two major refineries, you had bp's whiting, which went down for normal -- for the normal seasonal maintenance. should have been done by now but it won't be done until june. that's caused a problem in the interior of the country. and you had hess close its refineries on the east coast. you have taken almost half a million barrels out of the market, out of the gasoline refining and it's caused a very real shortage. add to that, i think a few people found themselves short of paper on the nymex and you took gasoline from, what, $2.75 to $3.35, you've probably gotten about as much out of this as you're going to get. i have my doubts as to whether we're going to see prices move much higher than now. would i sell it short, not with your money. certainly not with mine. but i think all of the fun, if there is any, if you can use that fun, is probably run its course. >> not much higher, but will we
stay at these high levels? i wanted to know if this impacts, at all, your view of the stock market and consumers ability to up coo spekeep spend. >> yes, he, she's going to be spending more money for their automobile, but let's look at what's happened to natural gas prices. the cost of heating their house, which is soon going to end, that has gone down rather dramatically. i think there's a great offset between what you're spending putting in your automobile and what you're spending to heat your house during the winter. i'm not sure the consumer is going to be that severely impacted. the only problem is psychologically, you see that gasoline price every time you go to the pump. that tends to have a greater psychological circumstances than does the benefit that would occur to you than lower natural gas prices. >> it's josh brown. aren't we using oil as a proxy for the potential of global growth, chinese demand, the rebound in europe. we don't want to see $5 at the
pump just yet, don't we actually want to see some demand for various typesmodties, just in general? >> one of the problems i have with that, look at what happened to copper today. copper prices declined rather dramatically. i didn't see any extraordinary news that came out indicating copper should weaken. but copper did. that argues against the thesis that crude oil is up only because of demand or expectations of global growth. i tend to think, i tend to believe, that the economy of the world is, in fact, doing better. >> didn't copper pull back because china was pulling back on the liquidity through repo lines. it's a pullback based on the notion that china is a big consumer. >> well, if that's true, then tin and zinc fell rather dramatically. >> they talked about putting clamps on the property. they hit all the industrial metals because china was worried
about the property prices. >> good. they should. they've had -- property prices in china got a little bit out of hand. they needed to put a stop to that at some point. >> all right, dennis, great to see you. >> thank you. thanks for having me on. >> dennis gartman. let's trade some gas price derivatives. the consumer stocks, especially in light of that walmart memo, citing an internal e-mail that february sales off to its worst start in years. you couple that with the pain at the pump, and not a pretty picture for the u.s. consumer at this point. >> i'm not going to go the consumer route. we've been talking about the refiner trades. look at psx. in the 40s, we said it is probably going to trade its name sake, 66, and here we are north of 65. they don't seem to want to stop right now. >> i think, last time oil was at $100, i thought we hit $4 a gallon already, i can't understand, one of you guys knows the answer, why is it that gas, maybe the premise is wrong,
but why is it that gas seems cheaper now with $100 oil? >> less taxes -- there's a spread, capacity inputs. not as simple as -- >> if you had the same inf infrastructure -- >> not all runs, you know, at capacity, at the same time. >> there's been a lot of shutdowns and the refining capacity is exactly what the difference is. the trade that i just want to point out that you should never be making here is the ung. if you look at the year of year basis, nat gas is up, ung is down. these things are supposed to be tethered. be really careful. names like apache, these are guys that are in the space, these are guys whose stocks are highly core lated to nat gas. >> i want to hit the consumer. karen, at what point do you get c concerned about the consumer? >> the walmart news is disconcerting. bad for walmart, bad for
jcpenney. i don't know that it matters as much to a macy's type customer. certainly less to a nordstrom type customer. i guess i feel -- macy's is our biggest bet. coming up next, afterhours action. dell reporting earnings. we are monitoring the conference call for the latest. plus, behind the office max/office depot merger to locate the next companies with the urge to merge. and later, google past 800 bucks a share. where one top analyst sees the search engine going next. that's coming up.
with unitedhealthcare, i get personalized information and rewards for addressing my health risks. but she's still going to give me a heart attack. that's health in numbers. unitedhealthcare. dell posting better than expected fourth quarter earnings tonight. jon fortt joins us now with the latest from the conference call. >> hey, melissa. interesting call. it's wrapping up right now, which makes it one of the shortest calls in memory.
michael dell not on the call. they are saying we're not going to talk about the buyout here. i guess because of the inherent conflict that some people might see in talking about that when they are talking about operations. bull here is some of the headlines. dell talking about them being at the low end of profitability that they've seen recently in the public business. so, that's tough. also, they think there's still some corporate refresh left. and they hope that picks up in the back half of the year. finally, in their growth markets, where they are not growing, they are saying china is stabilizing but brazil and india continue to be tough. one interesting pc market nugget, dell saying they believe that 40% of the corporate install base of pcs still running xp and vista, so, some opportunity there for someone, maybe dell, maybe someone else, to pick up some new sales toward the end of the year as companies cycle the old pcs out. melissa? >> jon, thank you for that. keep us posted. and dell has been trading above the lbo price that michael dell is offering. so, i guess the question is, is
the conference call offering any gl glimmers of hope and maybe another deal can come in, however unlikely that may be? >> i think that's so, so remote that another group -- that seems almost impossible. we have an expert on later, but i want to ask a question about, is this sort of shareholder revolt enough where some say, no deal is better than this deal. >> is there any reason to be in dell? >> i don't see any better reason. >> does this make you feel better about hp? >> not really. we've been on hpq since the autonomy announcement. but i go back to a couple of weeks ago, $17.32 high on monster volume. it needs to get above $18 for the next leg and i don't think it's going to happen. >> it's not just dell that is facing a possible deal. companies are buying each other, with office depot and office max the latest to hit the wire. joining us now is keith moore, event-driven strategist at mkm
partners. keith, great to see you. >> hello. great to be back. thank you. >> i want to ask you about dell, since that is in the news. does the stock price -- do you see the potential for another offer or for the office to be sweetened? >> well, i think the only way that michael dell and his group are going to get the deal done will be to raise the price. originally, we thought, when they came in at $13.65, they were talking about $14 or $14.25. but i think the way it's played out with the number of holders that have come out against it, i'm not sure $14.25 is going to be enough for them. but it's got a ways to go, i mean, i think people are anticipating something to happen shortly. i wouldn't expect that any increase will come until they're just about out of the s.e.c. with the proxy. and between now and then, i would expect that maybe the buying group could make some statements that, you know, they think their offer is fair here and might get people a little concerned and it could weaken a little. >> to me, it seems very
reminiscence of the j. crew situation. they had mickey drexler in the group. same here, michael dell. you have to have him in your group or you probably wouldn't want to do it. the end of the day, though, i -- i think -- do you know what -- if enough shareholders want appraisal rights, would they sue in delaware? is that something they could possibly do here? >> i don't think appraisal rights will be the way this one could go. i think if you go through the numbers, the dell group needs a majority of the remaining shareholders owned outside of the dell group. so, he owns -- that group owns 17%. he needs about 42% of the vote and there's already about 17% against, so, he needs 65% of the -- all the remaining shareholders to approve the deal. the way it's got to go is an increase at some point. >> i want to talk about future deals that you're keeping a watch on at this point. hess is one. actually, brought two names to
the table. both have activist investors in them. is that why you singled them out? >> since i'm an event-driven guy, my job isn't to pick the future takeovers, but we do look at situations like this, to see if it makes sense, even after the announcement is made. in both those cases, they both have assets that will probably -- are going to be worth more at a certain stage of the game. you know, we have to go through a few developments to get there, but what's different these days is, you know, for many years, when i've been in this game and karen's done it, as well, is, we can never figure out how to make money out of proxy fights. things have changed. activists have a lot more power than they ever have. >> so, let me ask you this, because elliott associates is in both names, playing a role, age stating for change in hess and compuwear. they have put forth an outline as to what they might do, that's all out there, the stock has
reacted to it, you still think there's upside for both? >> i do. in the case of hess, they are facing a proxy fight. they are probably going to have to do something in addition to who they said, selling the terminals. the first thing to do is separate the u.s. oil and gas fields, it will be worth a lot more money. in the case of compuware, not often do you have cases where there is limited downside to get involved, but they have announced they are going to do an ipo, spin the balance off and initiate a 50-cent year dividend. $11.50 stock and the spin-off could be worth almost two. if you get down to nine and a half with a 50 cent dividend, a lot of protection. >> and elliot offered 11 bucks a share last month, which was turned down. >> yes, and interestingly enough, they filed a 13-d last night, where they paid above $11. >> great to see you, keith. thank you for coming by. >> thank you very much. >> would you go into any of these names?
>> hess is interesting. it's underperformed for years. that would be a $30 billion or so deal. i don't know if the space of something like that can hall. compuware might be interesting. >> would you follow elliott associates? >> that's probably worth a look. >> will you take a look? >> i will. coming up next, activist investor david iron horn recaps his case against apple before a judge today. a decision could come as soon as tonight. and what it means for apple shareholders and much more. colin gillis gives us his take, and whether he thinks google stock has even more room to run. we'll be back right after this. tdd#: 1-800-345-2550 when i'm trading, i'm so into it, tdd#: 1-800-345-2550 hours can go by before i realize tdd#: 1-800-345-2550 that i haven't even looked away from my screen. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 that kind of focus... tdd#: 1-800-345-2550 that's what i have when i trade. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 and the streetsmart edge trading platform from charles schwab... tdd#: 1-800-345-2550 ...helps me keep an eye on what's really important to me. tdd#: 1-800-345-2550 it's packed with tools that help me work my strategies,
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greenlight capital's case against apple recently ended in downtown manhattan. here's the very latest -- >> you're on camera -- >> it's live tv. >> i like that. it happens. you have satellite trucks, a lot of moving parts here. we'll get kate to bring us the latest there. in terms of apple, karen, does this court case matter? >> it does matter a little bit.
i think that, if he wins, and then shareholders do get the chance to vote on this preferred, that they really have the opportunity to send a very loud message to management, that i hope isn't ignored. >> let's go back to kate. i'm told theed all owe issues have been resolved. kate? what's the latest there. >> melissa, so sorry about that. i'm standing outside the federal krou courthouse where it appears david einhorn might be getting a victory in the sense that a judge said he's going to issue an opinion very soon, possibly tonight or later this week. he didn't give a date. but he said he's inclined to find in greenlight capital's favor in terms of the merits of the case. they are saying that apple did wrong to shareholders by combining several different aspects into one proposal on that current proxy form. einhorn is in favor of two of the aspects and against one and thinks they should be broken up and one of them should be voted down. long story short, merits aren't enough. einhorn has to prove that he's been done harm by the combining of this elements and the judge
is not certain that he's going to find in that favor. melissa. so, we'll see what happens when the opinion officially comes out. but so far, it looks like, sort of a win, but potentially a loss and apple shares are essentially flat on it, so, shareholders are not overly concerned it would seem or they are waiting for a further judgment. >> all right, kate, thank you so much. kate kelly from lower manhattan. let's welcome colin gillis, fortune magazine's number one ranked most accurate apple earnings forecaster. colin, congratulations on that title. >> thank you. >> in terms of apple, i don't note if you have thoughts on the court case, but people are wondering about the next big catalyst. there's talk about the iwatch with revenue targets for the iwatch and then some others saying that a cheaper iphone is, in fact, on the way and could be good for china. >> right, right. so, let's start with the einhorn case. the issue here is, even if he wins, all that's going to do is raise awareness for his argument
to get that cash return to shareholders. it doesn't mean that apple is going to issue that preferred that he wants. >> okay. >> so, that's the most important thing. when a company issues a dividend, they tend to increase it, you know, one year later. if you look at what apple did a year ago in march, they issued the first, they issued the di divide dividend, so, they are likely to increase it. i don't see them issuing a new class of stock -- >> do you think it will increase the dividend even more than they might have otherwise, because of the spotlight now on -- >> i don't. >> you don't? no impact at all? >> people want that cash back, right? really what shea should be doing is using that cash, right? go out there, put that cas work. find some targets to buy. get a new revenue gross in, that's what people want. if you can't use it, give it back to shareholders. this is why apple looks stalled. we've got a big vacuum right now in terms of the product launch cycle. so, a watch could be nice. wearable computing is a big next phase. but google seems to be very much on top of that. samsung seems to be very much on
top of that. so, the chance that apple has a lead, like it's had with tablets and phones and wearable compu computing is likely to be slimmer. >> you're the most accurate earnings forecaster on apple. what do you see for apple? >> sure, well, absolutely, right, because, a lot of times you get the numbers right and the stock moves against you and you see that happening with google to a degree, the rise in google, i know we're going do that next. i think there's some upside here. i see it trading in line with the major averages. the markets have been moving -- >> so, there will be a catchup? >> correct. i think once that cash comes back, that will give you a bump, new products come out, that will give you a bump. >> let's now go to the plasma, apple down 20%, apple up 20%. has apple been the atm for google? >> absolutely. if you want to know where all that apple money went -- >> it could be netflix, as well, a lot of the other names -- >> of course. in terms of the market cap, if you think about google being 260
billion, apple that 450 billion, you need a big cap name to put those dollars into. and google's been the beneficiary. the thing i would point out on google, you look at the last three years, we've had six selloffs north of 10% and three of those have happened on the march quarter. the last three years, march quarter have started a downward decline of 10%. we heard about the pain at the pump, the payroll taxes, march quarter for consumer activity may be less than stellar. >> so, for seasonal reasons, stay away from the google trade? >> it will be below 800 this spring. >> so, what is your top trade in tech? >> listen, you want exposure to mobile, e-commerce, the nice tail winds, let's buy ebay. >> the consumer being weak doesn't freak you out when it comes to the ebay story? >> it does. but ebay is a trade down. when you go to ebay, you can buy last season's new goods,
refurbished goods and new goods. ebay is well positioned for a slowdown. >> colin, great to see you. the number one most accurate apple earning forecaster. >> that just rolls off the tongue. >> very catchy. all right, let's hit the options pits and see how traders are playing goin ining google at th. scott nations? >> a big call buyer today that disagrees with colin. we saw somebody buy 114 of the march 820 calls that paid $6 for those. that means that their break even is 826 even or about 2.5% higher than where the stock is right now. 114 options, not a lot of options, that's only 11,400 shares. but with google above $800, that's over $9 million worth of stock. so, this call buyer is taking a big position, but it's a position that only does well if google continues its run. >> all right, scott, thank you for that. more "options action" every friday at 5:00. still to come, jane wells has what is making headlines on the west coast. hey, jane. >> hey, melissa. up next, a farmer being sued by
monsanto says even a big evil corporation deserves justice. we'll explain, after the break. [ indistinct shouting ] ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪ [ engine turns over ] [ male announcer ] we created the luxury crossover and kept turning the page, writing the next chapter for the rx and lexus. this is the pursuit of perfection.
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from mobile devices to medical marn, we've got you covered in the west coast wrap. jane wells joins us from the best coast. jane? >> melissa, monsanto doesn't grow medical marijuana, yet, but it does grow soybeans. the seed giant sued 75-year-old farmer vernon bowman for using a second generation of roundup ready soybean seeds to grow another crop, violating its patent. farmers have to buy new seeds for every crop. bowman disagrees. groups are concerned a monsanto loss could hurt their own patents and stifle innovations. monsanto has won in lower court. and interestingly, though the audio is weird, bowman said outside court, he refulss to paint this as david and goliath. >> it don't matter how much bigger they are or even if they've been guilty of, if they are an evil company, which i'm not saying they are. but if they were, they would still have the rights to come after me, if i done something wrong, against the law.
>> and they did. monsanto has been facing and winning similar cases, melissa, in brazil and paraguay. >> does monsanto, does the case matter, tim? think it does. and i think it's precedent. i don't note if you can count the brazilian legal system as the precedent here. they won a big case down there. i like monsanto here and, again, if you look at the destruction that's going on in the soft space, mon san on the's been holding tough and they are not necessarily tethered to soy bin prices. >> jane? >> you were talking about gas prices. three something? please. gas prices here are topping five bucks in places. the rise being -- yeah, we are even having blackouts. the rise being blamed on refinery maintenance and the earlier arrival of summer blend gas. we're not really having blackouts. aaa calls ate mystery. and another mystery, who is launching twitter hack attacks? jeep, the latest victim, hacked by someone claiming jeep was bought by cadillac. the hacking looked similar to the takeover of burger king's
account yesterday, saying it has been sold to mcdonald's. then some clever social media teams thought they would have fun, mtv and b.e.t. made it looked like they hacked each other and denny's hacked itself. twitter's monitor activity works with users, but there's no fail safe system to establish if something is an opportunity. i want to pretent somebody hacked my account. >> jane, i already got your password. stay tuned. >> let's tell everyone. >> this is why i don't do twitter. >> is that the only reason? >> you had a couple of hacks on my account. >> tim leaves his twitter machine -- i could do some crazy stuff, but i don't roll that way. >> do it. >> that wasn't me, folks. >> that's who i am, jane. >> jane, thank you. >> you got it. coming up next who is in the spotlight for "fast money's" good, bad and ugly? back right after this. i know what you're thinking... transit fares! as in the 37 billion transit fares
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>> backstone, look at that today. first time it's been over 18 and i can't even tell you how long. blackstone continues to perform. i think that stock is another one to watch. >> i love it when the graphic is delayed and you have to wait for the tumble weed to go across the screen. >> our crack staff should do a better job. >> up 8%. >> interesting day today. 52-week high today and reversed. same thing a week, week and a half ago and rallied. it is worth watching again. i wasn't impressed by the way it traded today. be a little careful tomorrow. >> all right. now, onto the bad. about a month before his blackstone call, guy made the bear case for fedex in a "fast money" street fight. take a listen. >> quarter wasn't great, and they said some things that were sort of shaky going forward but the market reacted in a positive way. i would take this opportunity to get out of the name. but price doesn't lie. maybe you have another day tomorrow. >> up 16% since that -- >> wait a second. they have to freeze frame it.
what was interesting, the next day it did go higher. that was december 19th, day after my birthday. >> is the baby crying -- >> top with the baby crying. december 31st, new year's eve -- >> yes. >> that's the ugly -- it traded down to $90. so, i was sort of right. since then, it's been a slave to the tape. i wouldn't buy it. sort of right but very wrong. was that the ugly? >> obviously. do you have eyes? >> that's bad. >> show the picture one more time. >> why not? you did it already. our crack staff, they can't pull it off -- >> oh, there it is. making fun of me in my postman outfit. >> does ups know you're cheating on them? >> oh, once again. the great karen carpenter. outstanding. >> is this -- i don't think karen -- >> yeah, yeah. >> trust me. don't embarrass yourself. >> okay. >> it's karen carpenter. one of the top five voices of all time. go to commercial. >> anyway, up next on "mad money," cramer ising the charts to see if the shiny stuff
has lost its luster. plus, the ceo of american electric power, all coming up top of the hour. first move tomorrow when we come right back. stay tuned. hello! how sharp is your business security? can it help protect your people and property, while keeping out threats to your operations? it's not working! yes it is. welcome to tyco integrated security. with world-class monitoring centers and thousands of qualified technicians. we've got a personal passion to help your business run safer, smarter, and sharper. we are tyco integrated security. and we are sharper.
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